Financial Outcomes of Managed Entry Agreements for Pharmaceuticals in Italy

Key Points Question Are managed entry agreements (MEAs) important for the sustainability of pharmaceutical spending, and what are the financial outcomes of MEAs? Findings In this observational study of the financial outcomes of medicines with MEAs from 2019 to 2021 in Italy, the median proportion of payback to expenditure was 3.8%. Meaning These findings suggest that MEAs have limited importance for managing pharmaceutical expenditures; thus, prioritizing MEA use, identifying potential design changes, and improving implementation are valuable considerations.


Introduction
The introduction of novel and often expensive therapies poses important challenges for payers, especially when limited evidence of the added therapeutic value exists at the time of pricing and reimbursement decisions.A majority of countries in the Organisation for Economic Co-operation and Development (OECD) now apply managed entry agreements (MEAs). 1 These agreements aim to guarantee both access to novel, potentially innovative high-cost medications and sustainability of the pharmaceutical expenditure for payers, while managing uncertainty around their clinical effectiveness, cost-effectiveness, and budgetary effect. 2 MEA is defined as an arrangement between a manufacturer and payer that allows access to a health technology provided specified conditions are met. 3There are 2 main types of MEAs: financial-based schemes and health outcome-based schemes. 4,5The former, which is the most frequently applied in Europe, considers only financial aspects of a medicine, regardless of the potential effect on health outcomes, and may take the form of price-volume agreements with or without ceiling discounts or dose/utilization capping.In the case of price-volume agreements without a ceiling, the price of a medicine is associated with the defined volume sold, and the price declines when volume increases.According to price-volume agreements with ceiling, a maximum volume/budget that may be sold is established, and if the sales volume or budget is exceeded, the pharmaceutical manufacturer usually reduces the price of the medicine (ie, discount) or pays back the amount of sales exceeding the agreed levels (ie, rebate).7][8][9] Performance-linked reimbursement schemes aim to enhance the costeffectiveness of a new technology in clinical practice and may have a role in the financial sustainability of pharmaceutical spending. 5aly is one of the first countries in Europe to have adopted MEAs; the Agenzia Italiana del Farmaco (AIFA/Italian Medicines Agency) agreed on its first contract in July 2006. 10Agreements negotiated by AIFA and manufacturers are monitored either through data collection by setting up individual registries or routine sales data collection.Monitoring registries in Italy, set up before the establishment of AIFA, were conceived to promote appropriate use of new medications and evolved both in terms of scope and technical features.They were initially established to confirm the riskbenefit profile of medications used in clinical practice (eg, cholinesterase inhibitors to treat Alzheimer disease through the Cronos project). 11Throughout several years, the scope of registries has expanded to include data collection on patient characteristics (eg, prognostic factors for treatment response) and long-term data on efficacy and safety as a condition for full access to pharmaceuticals reimbursed by the Italian National Health Service (INHS) (eg, the PSOCARE project). 12More recently, registries have been used to manage novel oncologic medications by associating access to novel therapies with economic sustainability (ie, payment-by-result model). 13,14though MEAs have been used increasingly in the last decade in several jurisdictions, the body of current evidence on financial outcomes of MEAs is sparse. 15Published studies [16][17][18][19] provided only aggregated data on revenues paid by manufacturers in Italy in a single year; however, these studies provided no economic details by MEA type or information on expenditure for medications under MEAs.Another study estimated savings generated by the application of an MEA related to only 1 medicine, which was signed by the Catalan Health Service and pharmaceutical manufacturer. 20reover, the types of MEA applications are heterogeneous among various countries, though the reasons for different choices are still unclear. 21The objective of this observational study is to examine the importance of MEAs for the sustainability of pharmaceutical spending in Italy by analyzing the financial outcomes of MEAs for medications that were monitored through individual data registries from 2019 to 2021.

JAMA Health Forum | Original Investigation
Financial Outcomes of Managed Entry Agreements for Pharmaceuticals in Italy

Methods
In this observational study, we included medications that generated a payback between 2019 and 2021 and were monitored through individually collected data registries in the analysis.Only medications that were marketed during the 3-year study period and reimbursed by INHS in December 2021 were included.Medications that were monitored in registries that closed within the study period were excluded, as complete data for the period was unavailable for those products.
Medications not reimbursed or not delivered within the INHS were also excluded.This study was exempt from institutional review board approval because only aggregate economic data, not patient characteristics, were analyzed.
Paybacks from manufacturers to payers for each medication and type of MEA in the data analysis were monitored through the pharmaceutical spending monitoring activities conducted by AIFA.The expenditure data from 2019 to 2021 were collected through a national administrative database, the Italian Drug Traceability System, to which manufacturers provide sales data on pharmaceuticals purchased by all public health facilities.Expenditures were based on the purchase price truly paid by public health facilities (ie, net of confidential discounts).The expenditure data for medications were exhibited with all therapeutic indications included in a single presentation (ie, the expenditure values were not available by indication).In the case of a medication with multiple reimbursed indications, only some of which may be subject to an MEA, the payback was compared with the overall expenditure for the related medicinal product.A sensitivity analysis was conducted including a small sample of medications for which expenditure values by indication were available.To overcome the time misalignment between paybacks and expenditure data, the main analysis was conducted using cumulative data during the 3 years from 2019 to 2021.Payback data were measured when received from manufacturers, not when the medicine dispensation occurred, while expenditure data were collected when the medicine was purchased.The total amount of payback received for each medicine from 2019 to 2021, resulting from the application of the different MEAs, was calculated.The total amount of payback, as calculated, was compared with the expenditure on the corresponding medications observed in the same period.The proportion of payback to expenditure was calculated by type of agreement within each category of MEA.To examine the sensitivity of the findings to the potential time misalignment between paybacks and expenditures, we conducted an analysis stratifying the payback gained within a single year.

Results
From 2019 to 2021, 73 medications with MEAs generated a payback by manufacturers; in this analysis, 11 of these medications (15%) were excluded.Six medications were not reimbursable or delivered within INHS, and 5 medications were monitored by registries closed during the reference period.The final sample for analysis included 62 medications (eTable 1, eFigure 1A in Supplement 1).A

JAMA Health Forum | Original Investigation
Financial Outcomes of Managed Entry Agreements for Pharmaceuticals in Italy total of 53 of 62 medications (85%) belonged to the Anatomical Therapeutic Chemical (ATC) group antineoplastic and immunomodulating agents (L), and 5 of 62 medications (8%) belonged to the ATC group anti-infectives for systemic use (J), including medication for the treatment of hepatitis C (eFigure 1B in Supplement 1).
In a sensitivity analysis, the payback share was calculated in 7 of the medications for which the expenditure data were available by therapeutic indication.For outcome-based MEAs, the median payback share was 4.8%; for financial-based MEAs, the payback share was 2.0% (eTable 2 in Supplement 1).These results are largely consistent with the main analysis.
In this analysis, 50 of 62 medications presented a payback share less than 10%.The majority of medications with a payback share greater than 10% had expenditure values less than the median of €65.0 million (US $71.2 million), and most medications with payback shares lower than 5% were those with higher expenditure (eFigure 2 in Supplement 1).
Another sensitivity analysis stratifying the payback gained in a single year yielded similar results to the main analysis.The numbers of medicinal products generating revenues in 2019, 2020, and 2021 were 54, 55, and 59, respectively.The median (IQR) payback share for all agreements was 3.6%

Discussion
MEAs have been implemented in several countries worldwide to manage uncertainties around the added therapeutic value of medications.Nevertheless, little is known about the financial benefits of such arrangements.A recent report from the World Health Organization cast doubt on the effectiveness of MEAs in achieving affordable and equitable access to novel medicines. 22In our observational study, we quantified the magnitude of payments from manufacturers in different types of MEAs (either financial-based, outcome-based, or mixed) in Italy, an early adopter with the highest number of MEAs.Overall, the median payback share was 3.8% of expenditures for the medications included in the sample (3.7% for financial-based schemes, 3.3% for outcome-based schemes, and 6.7% for mixed schemes).Moreover, we demonstrated that payback shares greater than 10% were concentrated on medications with lower sales, and most medications with payback shares less than 5% were those with higher sales.In Belgium and Sweden, similar studies have been performed.
However, comparisons to our findings would be limited because these studies included different medications and types of MEAs.Indeed, our study only refers to MEAs based on registries; therefore, evaluation of MEAs using price-volume agreements with or without ceiling and confidential discounts were excluded.Moreover, these other studies did not quantify the magnitude of paybacks for the medications subject to MEAs by type of agreement.
The size of paybacks resulting from financial-based MEAs appeared to be modest.We suggest comparing the magnitude of paybacks with the resources required to implement and maintain financial-based MEAs.Implementation costs include the administrative burden for health care professionals who are required to provide registries with data.Paybacks may be obtained at a later stage (ie, several months after the reimbursement decision) compared with a simple immediate discount agreed on at the time of the reimbursement decision.In addition because of their smaller paybacks, payers may reconsider the value of outcome-based MEAs.We recommend assessing the level of clinical evidence maturity and the challenges of implementing registries that capture meaningful data on health outcomes, particularly shortly after a medicine is approved when evidence to inform the choice of an appropriate threshold for patient response may be limited.The identification of the clinical threshold, outcome measure, and assessment time is crucial with consequences for the magnitude of the payback.Clear definitions of these important elements should be part of the general guidance.We suggest these definitions be detailed in the MEA and explained in the clinical guidance.Our findings on small paybacks from MEAs suggest that payers may need to identify criteria to inform the adoption of MEAs, as well as which type, to ensure its optimal use.
Moreover, we recommend that the clinical uncertainties identified at the time of approval should be resolved in a defined period of 3 to 5 years.This parameter aims to provide timely definitions of the medication's added therapeutic value and return the collected information to clinical practice, as the evidence gaps to be filled may also change over time. 28

Limitations
First, expenditure data by indication for all medications in the analysis were unavailable.
Nevertheless, the sensitivity analyses on a limited sample of medications, for which expenditure data by indication (and related paybacks) were available, also demonstrated small paybacks from these MEAs.A second limitation of this study is the temporal misalignment of payback revenues and expenditure data, although sensitivity analyses conducted within calendar years were consistent with the results conducted using the 3-year cumulative data.Third, we were unable to estimate savings associated with reduced treatment failure rates obtained by the application of reimbursement criteria.These criteria, applied through the registries tool, allow the identification of patients most likely to benefit according to the available evidence.It is not possible to assess these savings in Italy because only patients meeting reimbursement criteria can access the treatment.

Conclusions
Despite the increasing use of MEAs, scarce evidence exists regarding the potential for this instrument to manage increasing pharmaceutical expenditures.This observational study found limited evidence that MEAs lower pharmaceutical expenditures.These findings suggest the need to identify criteria for prioritizing the use of MEAs and potential changes to their design and implementation.

Findings
agreements (MEAs) important for the sustainability of pharmaceutical spending, and what are the financial outcomes of MEAs?In this observational study of the financial outcomes of medicines with MEAs from 2019 to 2021 in Italy, the median proportion of payback to expenditure was 3.8%.Meaning These findings suggest that MEAs have limited importance for managing pharmaceutical expenditures; thus, prioritizing MEA use, identifying potential design changes, and improving implementation are valuable considerations.
Each medication was grouped according to one of 3 MEA types: financial-based, outcomebased, or mixed for medications that have multiple indications with different MEA types.Financialbased MEAs are further divided into 2 subtypes, cost sharing and capping MEAs.Cost-sharing MEAs provide discounts on the price of the first course or total duration of therapy for all treatmenteligible patients.This tool is usually implemented when the financial outcomes and clinical efficacy of a medicine are uncertain.Capping MEAs require the manufacturer to generate paybacks when the doses or number of cycles per patient defined at negotiation are exceeded.In addition, outcomebased MEAs are also divided into 2 subtypes, risk-sharing and payment-by-result MEAs.The risksharing model requires manufacturers to accept a discounted price for patients who do not respond to treatment, whereas the payment-by-result model requires a full refund by the pharmaceutical manufacturer for patients who do not respond to treatment.Usually, both risk-sharing MEAs and payment-by-result MEAs are implemented when the risk-benefit ratio is uncertain, and the definition of nonresponse is based on results of pivotal clinical trials.

A
total payback amount of €327.5 million (US $358.5 million) was received from the sample medications during the 3 years, corresponding to 0.9% of the €41.1 billion (US $45.0 billion) total expenditures for medications purchased by public health facilities in Italy.Although medicinal products were more frequently subject to outcome-based MEAs than to financial-based MEAs, the largest share of paybacks, €158.1 million (US $173.1 million), resulted from financial-based MEAs, whereas the outcome-based MEAs generated €74.5 million (US $81.6 million) in paybacks.Mixed MEAs generated €94.9 million (US $103.8 million).

Figure . 24 )
Figure.Distribution of Proportions of Payback Values to Total Expenditures by Category of Agreement and Subtype 40

Table .
Number of Medicinal Products, Overall Expenditure, Payback Amount, and Proportion of Payback to Expenditures by Category of Agreement and Subtype a b Financial outcomes of MEAs associated with medicinal products in data registries that were closed within the 3-year reference period (2019 to 2021) were excluded, as the data were incomplete.Medicinal products not reimbursable or delivered within the Italian National Health Service were also excluded from the analysis.
26 evaluation of MEAs signed in Belgium between 2010 and 2015 found no evidence within the framework of MEAs related to the research questions identified at the time of the Health Technology Assessment evaluation,27suggesting that other mechanisms beyond MEAs are needed to address evidence gaps.Therefore, we suggest that MEAs have a defined duration and re-evaluations of added therapeutic value be planned to ensure timely responses to changes in the body of evidence.Moreover, periodic revisions of MEAs' terms, leading to updates in the clinical threshold defining treatment response, may translate into better performance in terms of the payback gained.Pauwels et al26found that the durations of a large number of MEAs in Europe were extended after expiration.To our knowledge in Italy, the contract generally has a 24-month duration, and the identification of cases where data registries have led to a change in reimbursability remains an open issue.
29,30urrently available evidence suggests that MEAs may be more likely to ensure access and optimal use,29,30rather than guarantee the sustainability of pharmaceutical expenditures.When choosing whether and how to implement MEAs, payers may consider the following factors: administrative burden required for implementation, which includes developing and maintaining patient registries; predictability of net expenditures associated with delayed paybacks; level of evidence available to establish thresholds for treatment response in outcome-based MEAs; duration of MEAs; and time required for data collection.
Medicine included in the analysis (n=62) eFigure 1. A, Flow-chart of medicines included in the analysis; B, Distribution of medicines included in the analysis by ATC I eTable 2. Number of medicinal products, amount of payback and payback share by type and category of agreement in 2019-2021; only medicine with expenditure data by indication were included eFigure 2. Relation between payback share and INHS expenditure 2019-2021 eTable 3. Number of medicinal products, overall expenditure, amount of payback and payback share on expenditure by type and category of agreement in 2019 eFigure 3. Box plot: share of payback on expenditure by type and category of agreement: year 2019 eTable 4. Number of medicinal products, overall expenditure, amount of payback and payback share on expenditure by type and category of agreement in 2020 eFigure 4. Box plot: distribution of the magnitude of paybacks shown as share of total expenditures, by type and category of agreement: year 2020 eTable 5. Number of medicinal products, overall expenditure, amount of payback and payback share on expenditure by type and category of agreement in 2021 eFigure 5. Box plot: distribution of the magnitude of paybacks shown as share of total expenditures, by type and category of agreement: year 2021